Bettleboxs Breakdown of Zlines and MoMos

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Humble
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Postby Humble » Sat May 19, 2012 1:53 am

Here's my take of the same chart referred to in my last post, from my understanding of MO's teachings on memo, 50% zones, and closing higher or lower.

Comments welcome.

Is price closing higher or lower than something? Simple yet powerful question. ..MO

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totem
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Postby totem » Sat May 19, 2012 3:25 am

Maybe thinking too technically is not the best way to show how to trade the 50%.

My language is this now ...

1. Hey, THAT"S A STRONG MOVE out of that CONSOLIDATION, must be the smart money, I"M GONNA FOLLOW THAT
2. Not going to jump in now, price too high/low. I'm going to wait for a better price, may not happen but I can always hope
3. Mmm, I'm a logical human trader, I can assume smart money traders will also wait for a better price, where would that be??
4. Ok, if I was thinking like them, in the middle of that strong move is better than any, let's see what happens when/if price gets there
5a. Here's the middle, whoosh there's an engulfing/pin etc... gonna jump in ... SURFS UP BABY!
5b. Here's the middle, mmm no interest, MAYBE smart money are being smart and frugal, let's wait see if there's any interest lower/higher
etc ...

I do appreciate this thread and trading forum but that's why I think a lot of traders are getting confused on how to trade maybe thinking to rigidly and technically. 50% is just a tool we use to gauge thinking, sheep or smarts.

If charts are a map of people sentiment then all we do is to try and read it as best as we can

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bettlebox
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Postby bettlebox » Sat May 19, 2012 6:07 am

Exactly if you are too objective in price action trading you , well the short answer is you will lock yourself out trades.

My exprience of my journey so far:- When i started to learn dragons style, i quickly realised i wasnt getting any where near same number and level of trades as him. I ask myself everyday why not?
This was because there is alot to learn and its process of chart time to internalise all these things, as long you keep searching and asking,it will click.

Once things start to be internalised, this is the point you can then play with rules and start becoming more subjective in your trades.This leads to more opportunies. Until then rules keep you safe and define the boundaries.

This is exactly what happened with me, everyone goes through the same process. The important thing is know this process because there is danger of person giving up too soon.Knowing this will keep you moving forward with what you need to learn. You have to be proactive in the learning process, if your not you can quite easily make same mistake over and over again and not even realise it.

Confusion is of part process, it means you need to engage and learn. Bottom line as beginner i need the rules to build on, once i interalised the rules i can play with the rules, bend them ,combine them, mix them.So i move from rigid trading (objective) to more fluid trading (subjective). This is same process in anything you want to master.

Alot people forget this process and become frustrated with rules. And alot people give up. Its a shame.

This my take on too many rules.
BB

totem wrote:Maybe thinking too technically is not the best way to show how to trade the 50%.

My language is this now ...

1. Hey, THAT"S A STRONG MOVE out of that CONSOLIDATION, must be the smart money, I"M GONNA FOLLOW THAT
2. Not going to jump in now, price too high/low. I'm going to wait for a better price, may not happen but I can always hope
3. Mmm, I'm a logical human trader, I can assume smart money traders will also wait for a better price, where would that be??
4. Ok, if I was thinking like them, in the middle of that strong move is better than any, let's see what happens when/if price gets there
5a. Here's the middle, whoosh there's an engulfing/pin etc... gonna jump in ... SURFS UP BABY!
5b. Here's the middle, mmm no interest, MAYBE smart money are being smart and frugal, let's wait see if there's any interest lower/higher
etc ...

I do appreciate this thread and trading forum but that's why I think a lot of traders are getting confused on how to trade maybe thinking to rigidly and technically. 50% is just a tool we use to gauge thinking, sheep or smarts.

If charts are a map of people sentiment then all we do is to try and read it as best as we can
There are two forces acting upon us: Suffering pushes us forward from behind and pleasures entice us and pull us forward.

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bettlebox
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Postby bettlebox » Sat May 19, 2012 2:25 pm

Supply and Demand areas are usually found sitting on top of Momentum where price suddenly accelerated away. Hence the creation of MoMo.

If one these areas doesnt hold, that tells you something is up with the price movement and you potiential reversal on your hands.

If not doing what you expect then something is up. Its really simple.



There are two forces acting upon us: Suffering pushes us forward from behind and pleasures entice us and pull us forward.

totem
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Postby totem » Sun May 20, 2012 12:07 am

Just keeping things simple, another way to see the charts in story telling mode :) :) :)

I'm fairly certain about a few things in my chart

* things closing under each other
* seeing a strong move in one direction possibly meaning smart sellers are around --- from an extreme
* smart sellers usually want the best price to sell more in their distribution phase so I anticipate price would probably come back up. Also this is a test by the sellers to see if there are any more buyers buying that could spoil their down move.
* 50% is good as any level, price may come to a third before continuing on its merry way (due to excess supply I'm guessing). Let's call this the bargain area.
* In the bargain area, I'll be watching the 5, 15 min for wicks in direction of loss, then bodies in direction of profit (thanks MO!) --- which is mostly a giveaway for knowing there is more supply than demand at that time
* If I see volume increasing on buyers candles in the bargain areas, it could mean there are still buyers around, I wouldn't sell yet. If there isn't much volume on up bars in the bargain area, logically you can say there are no more bulls around so its also one sell consideration

Volume could good ammo to use for entries but I still observing on this, thoughts appreciated. Just watch for wicks in these bargain areas as they are quite numerous.

Sorry BB, just rambling and didn't know where to post this so hijack! :lol:

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Postby bettlebox » Sun May 20, 2012 8:13 am

i use dragons entry method, if i can find 15min zline in my potiential entry area i will use that as well. In example if price starting close about the 15min zline i wouldn't be taking a trade short.

here is the example Page one is 15min chart with 1hr overlay and page 2 is 5min zoomed in chart of entry area.

PAGE 1


PAGE 2

BB

totem wrote:Just keeping things simple, another way to see the charts in story telling mode :) :) :)

I'm fairly certain about a few things in my chart

* things closing under each other
* seeing a strong move in one direction possibly meaning smart sellers are around --- from an extreme
* smart sellers usually want the best price to sell more in their distribution phase so I anticipate price would probably come back up. Also this is a test by the sellers to see if there are any more buyers buying that could spoil their down move.
* 50% is good as any level, price may come to a third before continuing on its merry way (due to excess supply I'm guessing). Let's call this the bargain area.
* In the bargain area, I'll be watching the 5, 15 min for wicks in direction of loss, then bodies in direction of profit (thanks MO!) --- which is mostly a giveaway for knowing there is more supply than demand at that time
* If I see volume increasing on buyers candles in the bargain areas, it could mean there are still buyers around, I wouldn't sell yet. If there isn't much volume on up bars in the bargain area, logically you can say there are no more bulls around so its also one sell consideration

Volume could good ammo to use for entries but I still observing on this, thoughts appreciated. Just watch for wicks in these bargain areas as they are quite numerous.

Sorry BB, just rambling and didn't know where to post this so hijack! :lol:

Image
There are two forces acting upon us: Suffering pushes us forward from behind and pleasures entice us and pull us forward.

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Postby forexjpn » Sun May 20, 2012 10:34 am

This is just to illustrate what I meant by lack of retrace.....sorry if this is clogging your thread, this will be my last post about this.

MO often talked about 'held profit'......this held profit is created by a long ass bar (LAB), which could be seen as MOMO by definition, but in fact is the beginning of a very strong trend. These LAB's usually have no retrace and may in fact 'spawn' many more MOMO's with no retrace........this could last for days or a week or even more. I feel it is better to look at these held profit 'zones' as areas from which price can go either way and learning how to trade in and around these zones (back in toward closing held profit or away from these zones in a strong trend) is more productive.
This is where trading lines (edges of the zones) and incorportating smaller MOMO's going away from these lines (in either direction) is useful.
Also, as newer 'held profit' zones develop, I consider the closest one or two the most significant until price fills those zones or moves away from them again.

Until very recently I use to trade retraces on MOMO exclusively and although it's still a very important part of my trading, I felt price moved so much around these retraces that my time wasn't being used efficiently.....
Again, this is only me......it definitely looks like everyone is doing very well with 50% retracements and making pips is all that matters.

Cheers
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Postby bredin » Mon May 21, 2012 11:54 pm

forexjpn,

we are calling those "leave behind zlines", and they are very exciting :)

On the way back up they are targets in their own right, on the way down they are confirmations that all is well.

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Postby dojirock » Tue May 22, 2012 12:40 am

bb,

Its hard to give input when we cant see the prices, pair, or time...way two small of a window to try to trade out of..... :)

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"A small loss is just as satisfying as a large gain" -MO
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Postby dojirock » Tue May 22, 2012 12:41 am

This is the history I have spoke of......
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